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Bypassing higher ed

2010-09-10 22:05:04.119226+00 by Dan Lyke 4 comments

Washington Post: Some say bypassing a higher education is smarter than paying for a degree.

"There's a billion other things you could do with your money," Altucher says. One option: Invest the money you'd spend on tuition in Treasury bills for your child's retirement. According to Altucher, $200,000 earning 5 percent a year over 50 years would amount to $2.8 million.

(Via Crasch.) It's mainstream media, so of course they don't have any statistics, just anecdotes, but...

[ related topics: Journalism and Media Education Economics ]

comments in descending chronological order (reverse):

#Comment Re: made: 2010-09-12 22:44:50.475226+00 by: Dan Lyke

On the money, Philip Greenspun has some observations.

#Comment Re: made: 2010-09-12 11:07:14.571226+00 by: Dan Lyke

Sean, I think you mean it the other way around: if modern-day $1.1m-$5.4m is worth $200k in 1960 dollars, if historical trends hold that $2.8 million in today's dollars could be worth $400k or $80k in 50 years. So, yeah, the key is 5% after inflation.

But if, as we've posited before, college works as a relatively noisy high-pass filter, then the question is: what's a reasonable career path? How long are cushy government jobs with big pensions going to be the rage, or are you better off taking a more entrepreneurial approach?

A lot of this depends on personality, but I think we're finding more and more that if you have the drive and intelligence, then college is a detriment.

#Comment Re: made: 2010-09-12 03:38:06.263226+00 by: ebradway

Overall, it's a darned good article. It also starts to address the situation where your parents maybe saved $10K-$20K. Best investment: travel, start a business... not college.

I just wrote a long email to my daughter describing why having $20K in the bank when you start college is a bad idea. All it really does is reduce your ability to get scholarships and financial aid. Smarter move: blow the wad of cash on travel, wait until you are emancipated from your parents, go to a reasonably priced school for a professional degree. Assuming, of course, the business doesn't work out.

#Comment Re: made: 2010-09-10 23:24:15.435226+00 by: spc476

And $2.8m will be worth what in 50 years? 50 years ago, $200,000 in 1960 dollars may be worth between $1.1m and $5.4m in 2009 dollars (depending on how you calculate inflation).

On the other hand, $200,000 worth of gold in 1960 would be worth a bit over $7m today (silver on the other hand, would be worth $4.4m today).